Wall Street rally rolls into fifth day; banks and tech lead

NDTV Profit Desk

08 May 2013, 11:24 PM IST

Wall Street rally rolls into fifth day; banks and tech lead

U.S. stocks rose on Wednesday, bolstered by the financial and technology sectors, and were set to scale fresh highs as a rally kept going for a fifth consecutive session.

The S&P 500 financial sector index rose 0.6 per cent, with JPMorgan Chase & Co up 1.4 per cent at $49.83. It was among the Dow's top percentage gainers.

Technology stocks also outperformed the broader market, lifting the Nasdaq index. Apple shares rose more than 1 per cent after falling in the previous session.

Wall Street had started off lower as investors locked in profits after four days of gains that took equity indexes to new highs a day earlier. But the market rebounded in early morning trade as investors saw the dip as an opportunity to buy.

Boosting the Nasdaq, Apple shares rose 1.3 per cent to $464.72 and Google Inc gained 1.4 per cent to $868.85.

Among bank stocks, Bank of America shares rose 1.9 per cent to $13.14 and Citigroup Inc shot up 2.4 per cent to $49.25.

The Dow Jones industrial average was up 11.26 points, or 0.07 per cent, at 15,067.46. The Standard & Poor's 500 Index was up 4.15 points, or 0.26 per cent, at 1,630.11. The Nasdaq Composite Index was up 13.05 points, or 0.38 per cent, at 3,409.67.

The S&P 500 has climbed 2.7 per cent over the past four sessions, and is up 14 per cent this year. Both the S&P 500 and the Dow closed at new highs on Tuesday, with the Dow ending above 15,000 for the first time ever.

"Our intermediate-term indicators keep us skeptical about a breakaway move. (But) Overall, we believe that a seasonal correction in the coming months should provide an opportunity to buy stocks at more attractive levels," wrote Ari Wald, technical analyst at PrinceRidge Group, a New York-based investment bank, in a note to clients.

Wall Street hasn't yet undergone a sustained slide this year as investors have bought on market declines. Robust corporate results and the Federal Reserve's accommodative monetary policies have supported the market's advance, which has recently been led by cyclical sectors tied to the pace of economic growth.

"We have a lot of interest in energy and material names at these levels," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma. "Both seem like big growth areas that are undervalued."

Late on Tuesday, Dow component Walt Disney Co reported earnings that beat expectations and revenue that was up 10 percent, while Whole Foods Market Inc reported a rebound in same-store sales and raised its full-year profit view.

Shares of Disney slipped 0.6 per cent to $65.65 while Whole Foods jumped 10 per cent to $102.10.

J.C. Penney Co Inc reported another quarter of steep sales declines, though investors were encouraged that the struggling department-store chain posted cash levels that implied it had gone through less money than feared.The stock rose 8.7 per cent to $17.82, but remains down about 11 per cent for the year.

AOL Inc shares fell 8.5 per cent to $37.92 after the online media company reported earnings that missed expectations, though revenue rose more than anticipated.

Earnings have largely been better than expected this quarter, with about 68.5 per cent of S&P 500 companies surpassing estimates so far. At the same time, revenues have been disappointing.

Wall Street traders were also keeping a close eye on the Sohn Investment Conference, a big event in the hedge fund industry, where prominent investors, including Jim Chanos, David Einhorn and Jeffrey Gundlach, tick off their best investment ideas.